Terry v. Anderson - 95 U.S. 628 (1877)
U.S. Supreme Court
Terry v. Anderson, 95 U.S. 628 (1877)
Terry v. Anderson
95 U.S. 628
1. An enactment reducing the time prescribed by the statute of limitations in force when the right of action accrued is not unconstitutional provided a reasonable time be given for the commencement of a suit before the bar takes effect.
2. This Court concurs in opinion with the Supreme Court of Georgia that the time prescribed by the statute of that state, approved March 16, 1863, in which suits for the enforcement of rights which accrued prior to June 1, 1865, should be brought is not so short or unreasonable, under the circumstances which led to its enactment, as to render it unconstitutional.
3. That statute may be set up as a valid bar to suits brought after Jan. 1, 1870, to enforce the individual liability of the stockholders of a bank in that state for the ultimate redemption of its bills which it ceased and failed to pay before June 1, 1865, or to recover the unpaid balance due on stock subscriptions at the time of such failure.
4. That balance is a debt to the bank, and inures to the benefit of all its creditors, while the individual liability for the redemption of its bills operates only in favor of the holders of them.
5. Quaere,, can a creditor of a dissolved corporation who has not recovered a judgment and exhausted his remedies at law proceed in equity to subject chosen in action to the payment of his demand ?
6. A statutory liability is as much the subject of remedial legislation as a liability by contract, unless the remedy enters into and forms a part of the obligation which the statute creates.
The Planters' Bank of the state of Georgia was incorporated by the legislature of that state, with a charter, providing that the stockholders, for the time being, shall
"be pledged and bound, in proportion to the amount of the shares that each individual or company may hold in said bank, for the ultimate redemption of the bills or notes issued by or from said bank, during the time he, she, or they may hold such stock, in the same manner as in ordinary commercial cases, or in simple cases of debt."
The bank issued notes, some of which, in due course of trade, came into the possession of the complainants.
The bank failed to pay its notes in lawful money on the twentieth day of February, 1865, and nothing has been paid thereon except as hereinafter stated.
On the 24th of May, 1866, the stockholders, being of opinion that the corporation was insolvent and unable to pay its debts,
ordered the board of directors to execute an assignment to Anderson and Mercer of the assets of the bank, for the purpose of equally distributing them among the creditors and bill-holders, and to surrender its charter to the governor of the state at such time as they might deem expedient.
On the 9th of July, 1866, the directors, in the name of the bank, assigned to Anderson and Mercer its property, both real and personal, and made said assignees their attorneys, in the name of the bank or otherwise, and, for the trusts created by the assignment, to ask, demand, recover, and receive of and from all and every person and persons all and singular the property and estate, goods, chattels, wares, merchandise, debts, choses in action, sum and sums of money and demands due and owing or belonging to said bank, and in default of delivery or payment in the premises, to sue, prosecute, and implead for the same, as they might see fit, &c.
The assignees accepted their trust on the same day, and soon after published a notice to all bill-holders and other persons having claims against the bank, to present them for liquidation.
On the 24th of December, 1869, Harvey Terry presented to the assignees for liquidation bills of the said bank, to the amount of $5,605.
Joshua and Thomas Green, in December of that year, presented to the assignees for liquidation bills to the amount of $5,791. Upon the bills so presented, a dividend of twenty percent was paid before Jan. 1, 1870.
Subsequently to the payment of this dividend, the assignees filed a bill in equity in the Superior Court of Chatham County, Georgia. McNish and other creditors of the bank, including the present complainants, were made defendants.
Their object was to obtain direction as to the mode of paying out the assets in their hands; and the court, July 14, 1871, adjudged, among other things, that there was due to Terry the sum of $5,605, less the dividend of twenty percent received by him, and also the sum of $1,117, on bills on which he had received no dividend; that there was due to Joshua and to Thomas Green $5,791 on bills of the bank, less the dividend of twenty percent previously paid thereon; and that the assignees
should pay the balance of the assets to all creditors named in the decree, in proportion to their respective dues.
In obedience to the decree, the assignees paid further dividends, making the whole amount so paid thirty and one-eighth percent of the face value of the bills, and they were finally discharged June 30, 1873.
On the eighteenth day of March, 1869, the General Assembly of Georgia passed an act accepting the surrender of the charter of the bank.
The amount of bills outstanding at the time of the failure of the bank was $1,460,112. Of this amount, $207,448 were redeemed before the bank executed its deed of assignment.
Besides the bills so presented by said Terry, he is now the owner and holder of bills to the amount of $1,464, upon which no dividend has been paid.
The present bill of complaint was filed April 6, 1874, by him, Joshua Green, and Thomas Green, on behalf of themselves and others, against said Anderson and Mercer, the assignees and the other defendants who are stockholders of the bank. It sets forth the preceding facts, and alleges that at the time the bank failed its capital stock was not paid in full, and that many of the stockholders had paid in only about eighty percent of their subscription; that the right to sue for and recover the several balances due by them on their shares passed by the assignment of July 9, 1866, to the assignees, who had never collected them.
It prays that the stockholders be decreed to pay such sum upon each share of stock owned and held by them respectively as shall make up the full sum of $100 -- its par value -- and such further sums respectively as may be found due, in order to pay the complainants' demands.
The defendant Anderson demurred generally.
The others demurred specially, upon the ground
1, that the suit was barred by the statute of limitations;
2, that complainants, although defendants in the case of Anderson and Mercer against McNish and others, in the Superior Court for Chatham County, allege no reason or excuse for not seeking the aid of that court to require the assignees to collect the unpaid subscriptions due from the several stockholders, or why
the decree rendered in that cause should not be conclusive and binding upon them,
3, that the complainants do not allege that the defendants held any stock of the bank when the bills were issued, and
4, that as to the bills amounting to $1,464, as to which Terry seeks judgment, the complaint does not set forth whether he became the holder of them before or after the final decree in that case, or why they were not presented for participation in the distribution of assets of the bank.
The demurrers were sustained and the bill was dismissed. The complainants thereupon brought the case here.
The statute of limitations of Georgia approved March 16, 1869, so far as it bears upon this case, is as follows:
"SECTION 3. And be it further enacted that all actions on bonds or other instruments under seal, and all suits for the enforcement of rights accruing to individuals or corporations, under the statute or acts of incorporation, or in any way by the operation of law which accrued prior to the 1st of June, 1865, not now barred, shall be brought by the 1st of January, 1870, or the right of the party, plaintiff or claimant, and all right of action for its enforcement, shall be forever barred."
"SEC. 4. And be it further enacted that all actions on promissory notes, bills of exchange, or other simple contracts in writing, and all actions on open accounts, or for the breach of any contract not under the hand of the party sought to be charged, or upon any implied assumpsit or undertaking, which accrued on a contract which was made prior to June 1, 1865, not now barred, shall be brought by the 1st of January next, after the passage of this act, or the right of the party, plaintiff or claimant, and all right of action for its enforcement shall be for ever barred."
"SEC. 6. And be it further enacted, that all other actions upon contracts, expressed or implied, or upon any debt or liability whatsoever, due the public, or a corporation, or a private individual or individuals, which accrued prior to the 1st of June, 1865, and are not now barred, shall be brought by the 1st of January, 1870, or both the right and the right of action to enforce it shall be forever barred. All limitations hereinbefore expressed shall apply as well to courts of equity as courts of law, and the limitation shall take effect in all cases mentioned in this act, whether the right of action had actually accrued prior to the 1st of June, 1865, or was then only inchoate and imperfect, if the contract or liability was then in existence. "